Normally,
I know very fairly few details of my clients' money matters. The
mortgage broker handles that -- she sees their bank statements,
calculates their debts, and becomes intimately aware of their incomes
and what they have tucked away in retirement and savings accounts.

Once
they have a loan approval, for most of my clients, how much they have
is less relevant for my purposes than how much they want to actually
use toward their home purchase, and how much they want to spend every
month -- versus how much they have, and how much they can
spend.

So, I was somewhat surprised to make a discovery about a client who had been really pinching pennies -- clear
on what she wanted, and qualified at a much higher price point than she
was looking, but struggling to find what she wanted in her
self-imposed price limitations. She had been house hunting for months
and expressing her frustration, but unwilling to inch up in price to
get beyond them.

We were writing yet another below-asking offer
on a home that just barely fit her minimum requirements, but had been
on the market for longer than normal, giving us a modicum of hope. The
seller, a bank, requested to see proof of her downpayment funds in the
form of an actual account statement, with all the security-sensitive
information redacted out.

Though my mortgage broker had mentioned
that this woman was able to afford more, I had no idea how able she
was until she sent over her savings account statement for me to send to
the bank/seller of this property.

Alrighty then. With thousands
and thousands of dollars in the bank above and beyond what she'd need
to close the deal -- and ostensibly other retirement and traded asset
accounts containing funds to which I'm still not privy -- why have we
been agonizing over a thousand here and a thousand there, which has
been making the difference between her ability to buy a home she likes,
and not?

Or, what's worse, why have we been mimicking
Cinderella's stepsisters, trying to cram the big old feet of this
buyer's wants and needs into the tiny glass slipper of the price range
she's decided to stick within?

Apparently, this woman is
embracing the "new frugality" that is now so popular among Americans.
Though spending and net worth indicators are moving upwards, a recent
Associated Press survey of 44 economists found that two-thirds of
respondents believe these penny-pinching ways are and will continue to
outlive the recession.

Many of the two dozen laypeople surveyed
agreed -- more than one interviewee described her personal economic
downturn and it's permanent impact on her spending habits with the
words, "I will never spend like that again."

This makes sense to
me. This Great Recession was excruciating for almost everyone I know,
especially those of us whose asset allocations were very real estate
heavy. Myself and most every real estate investor and professional I
know are personally doing the work on our own relationships with money
and taking steps to make sure we (money and me!) get and stay on good
terms.

So, I wholeheartedly applaud the homebuyer who decides to
spend no more than $300,000 on their home, even though they are
qualified to spend $500,000. In light of recent events, I believe that
the influx of this sort of individual into the ranks of homeowners will
inject long-term sustainability into the markets, which benefits every
American who owns a home, in the long run.

But, with that said,
frugality means cutting back, scaling down, living less extravagantly
and sometimes doing without things you might have run out and bought a
few years back without blinking an eye. It doesn't mean simply spending
less but expecting to get as much as or more than you did before
(although this is an occasional side effect of the recession).

The
reality is, even now, homes aren't being given away, and the fact that
you're clear on what you want to spend does not necessarily mean
there's a seller out there who is on the same page.

The new
frugality means being willing to make sacrifices or compromises in your
wants and needs, but still living well. So, the homebuyers out there
who are trying to stay conservative with their price ranges might need
to consider proportionately scaling back the must-have specs for their
dream home. Otherwise, their house hunt might shift from The Search for
The American Dream to The Neverending Story.